Consulting Agreements: A Comprehensive Guide (2020)

A consultant is a person with specific knowledge or expertise, which he or she can lend to your business under the terms of a consulting agreement.

Consultants can bring your business a fresh perspective and help you gain a competitive edge, but without a proper consulting agreement it can be difficult to avail the full benefits of a consulting relationship.

Types of Consulting Agreements

The consulting contact is an essential document which can save you from plenty of legal trouble further down the line. It is a formal, legally binding document, which sets out all terms and obligations that exist between the company and the consultant.

The Business-in-a-Box consulting category offers 12 kinds of templates related to the field of consultancy, including context specific agreements, detailed and brief agreements, business plans for consultants, etc. All of these documents are available for download in MS word format.

General Consulting Agreements

Consulting Agreement (Long)

The consulting agreement long is a detailed, 12 page document which goes over every term of a consulting relationship. This includes all the obligations you or your consultant may have to each other, and every possible scenario that can arise during the consultation period, such as breach of terms, bankruptcy, or negligence by either party. In this way, the consulting agreement long protects both parties from any harm.

It is recommended that you use a more detailed consulting agreement if there is more risk involved in this venture. For example, if you have trade secrets such as formulas, inventions, strategies, that you cannot risk leaking to the public, and you must let the consultant in on these secrets if he or she is to properly perform their services, then a longer consulting agreement is recommended. This is because the long consulting agreement includes clauses that prevent the consultant from disclosing important information, and aids you in taking legal action in case any breach is made.

Consulting Agreement (Short)

The consulting agreement short is a brief, legally binding document which outlines the terms of a consultancy agreement. This form of consulting agreement is 2 pages, and only covers the essentials of a consulting agreement. That is, the basic terms and conditions; the time the consultant will dedicate to their work, the work place of the consultant, etc. The brief consulting agreement also contains a clause which ensures confidentiality, but unlike the longer agreement it does not specify what kind of legal action can be taken against breaches. It also defines the status of the consultant as an independent contractor and not an employee, which is an important clause that prevents the consultant from receiving employee benefits.

This kind of consulting agreement is helpful if your relationship is lower risk, and the work entrusted to the consultant is not too important. For example, if you are hiring a creative consultant to make posters or web content for you, a brief agreement might be more suitable. However, keep in mind every possible scenario that could go wrong during the consultancy, and be sure to include provisions for it in the final draft.

Context-Based Consulting Agreements

Every consulting relationship is different, as every client requires different services for their business. Because of this, Business-in-a-Box has curated context specific templates for consulting agreements.
These include:

1. Software Development and Consulting Services Agreement.

Hiring a consultant for software development can be tricky, as there are often legal disputes over who has ownership and patent rights over the final software produced. To avoid these kinds of legal problems, a detailed software development consulting agreement has been prepared. The template gives the user an option to attach specifications for the software that needs to be developed. It also includes the time that the developer is given, the consequence of not completing the software on time, and what is to happen in case the first software submitted fails the acceptance test. A sample acceptance test has also been attached. Overall, it is a 14 page document and includes all details of payment, workplace, schedule etc.

2. Time And Materials Consulting Agreement

Time and materials consulting contract generally used for construction services, or other similar projects, for which your business might need to hire an independent contractor. This is a 9 page contract which specifies that payment is to be made at an hourly rate to the contractor. It also contains clauses that detail who will have ownership rights over the final deliverables. It defines the relationship between the two parties, which is not one of a joint venture but rather of two independent contractors.

In a project such as a time and materials one, it may be important to consider what will happen in case of damages to property or even the death of either parties employee(s). In this template, liability clauses are given which go over every possible scenario, which can help protect your party in case of legal disputes.

3. Website design consultation agreement.

Website design is important in giving you a competitive edge over your competitors. Hiring a consultant for your website design can be a fruitful endeavour and help you gain a creative, user-friendly website to attract more customers. The website design consulting agreement is 8 pages long, and goes over all the essential clauses you may need when hiring a website design independent contractor.

You have the option to attach the detailed specifications for your website design in this template. Alongside this, you can also attach a compensation schedule, which is to be followed as you make payments to the website developer. The agreement declares that the website developer will provide their services to you to the best of their ability. It also goes over the important topic of proprietary rights. In this agreement, the client has all rights to the work submitted by the website developer. This template also ensures that the website developer keeps any and all sensitive information shared by the company confidential. Lastly, it ensures that the relationship is defined as that of independent contractors.

4. Consulting Agreement with Sharing Of Software Revenue.

Profit sharing may be desirable to you if you are a software developer, as it ensures that if your software becomes popular in the market and generates revenues, you will also be entitled to a share. The Consulting Agreement with Sharing of Software Revenue template makes sure to include a clause which specifies what percentage of profits will be received by the soft developer out of the company's revenue. Alongside this, the 6 page document features declarations from the consultant to perform development, maintenance, support, and consulting regarding the software. It also ensures that the consultant gives reports of his or her progress to an allotted project manager. It binds the consultant to a non-disclosure agreement, ensuring that the company's secrets remain safe. Lastly, the agreement hands over all rights over the final software to the company.

Non-Disclosure Agreement for Consultants

Keeping your company's secrets safe can be one of the main concerns when entering into consulting agreements. Because of this, Business-in-a-Box has designed the following confidentiality and non-disclosure agreements.

1. Consultant Non-Disclosure Agreement

This 3-page non-disclosure agreement briefly goes over the clauses of confidentiality. It begins by using the term “proprietary information” to describe any property or information handed to the consultant which must not be disclosed to anyone other than trusted consultant personnel. The consultant non-disclosure agreement template ensures that the consultant will return any tangible property given to him during the course of the consultancy. The injunctive relief clause allows the company to take action against the consultant in case any proprietary information is disclosed.

2. Confidentiality agreement for consultants, contractors

The confidentiality agreement for consultants, contractors is a more detailed confidentiality agreement when compared to the simple non-disclosure agreement. The term ‘signatory’ is used to define the contractor or consultant who will be working with you to provide their expertise and with whom confidential information will be shared. The document holds a declaration from the signatory that he or she will not share the confidential information without permission, and will immediately return any tangible forms of it upon request. The signatory has no rights over the proprietary information, as it belongs solely to the company. The signatory also cannot engage in any activity that is deemed competitive to the company for an agreed upon period of time after termination of the contract. The template covers legal scenarios such as breach of the agreement, in which case it is decided beforehand who is to deal with court and attorney fees.

Consultant Business Plans

If you are planning to join the consulting industry and begin a consultancy business yourself, you will first and foremost require a Business Plan in order to gain the trust of investors, secure startup finance, and have clear goals and targets in mind. The following consultant business plan templates are available for use:

1. Consultant Business Plan

This basic consultant business plan template has all the important aspects of your business sleekly summarized and ready to go. It begins with stating the grant that you wish to gain from the lender, and goes on to detail the business expenses that this grant will be used on. It gives a space for your mission statement and goals in order to show the lender that your firm is focused and well organized, and also gives a brief company history. Visual graphs of your company's latest performances are included to encourage investors to lend money.

The template dives into details about the exact services you offer as a consultant. There is also a section where you can include details of your target market, and how you intend to outperform your competitors and appeal to different kinds of customers. You can add details of your marketing, financial, and management plans as well.

2. Marketing Consultant Business Plan

Marketing consultancy is one of the most popular forms of consultancy, and is commonly availed by businesses to develop new strategies for attracting customers. This template is designed for marketing consultancy firms who may wish to attract lenders and investors to their business.

The marketing consultant business plan template allows you to add an executive summary of your marketing consultancy firm, as well its long-term goals, objectives, and mission. Like the general consultancy business plan, it offers visual charts and graphs to display past performance of the firm. It also allows you to fill in your marketing, management, operational, and financial so that the reader gets to know every aspect of your business.

2. Letter of agreement master professional services agreement.

The letter of agreement master professional services is a contract that is made between two parties and holds the terms that will govern any future communication and transactions made between the two. The contract is not a binding agreement, and will expire if a definitive agreement between the two parties is not reached. The contract includes details of all the services that one party is to provide for the other.

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